Source – www.inquirer.com
Budget Proposal Includes Tuition Adjustments and Rate Freeze
Penn State University has outlined its proposed budget for the 2025-26 academic year, which features a tuition increase for University Park students while maintaining a tuition freeze for those at Commonwealth Campuses. The $9.9 billion budget, which includes a $2.9 billion Education and General fund, was recommended for approval by the Board of Trustees’ Committee on Finance, Business and Capital Planning during their meeting at the Penn State Altoona campus. The full board is scheduled to vote on the budget, tuition, and room and board rates on Friday at the Harry E. Slep Student Center in Altoona.
The university adopted a two-year budgeting model last July, setting the rates for the 2024-25 fiscal year in advance. Penn State President Neeli Bendapudi highlighted the importance of balancing the budget to strengthen the university’s financial position and support its mission in research and academics.
Tuition Changes for University Park and Commonwealth Campuses
For the 2025-26 academic year, Penn State plans to increase tuition at University Park by 2% for in-state students and 4% for out-of-state students. In-state freshmen and sophomores will face a $402 increase, bringing their annual tuition to $20,468. Out-of-state students in the same categories will see a $1,648 rise, making their tuition $42,860. Student fees at University Park will also rise by $52, or 8.3%, totaling $630 for the year.
In contrast, Pennsylvania resident undergraduates at the Commonwealth Campuses will not experience a tuition increase. Out-of-state undergraduates and in-state graduate students will see modest increases of 1%, while out-of-state graduate students will face a 2% hike. The rate adjustments for Commonwealth Campuses vary, with out-of-state undergraduates facing increases between $232 and $264. Student fees at Commonwealth Campuses will also see slight increases, ranging from $28 to $32, depending on the campus. World Campus students will experience a 1% increase in tuition.
Bendapudi acknowledged the financial impact of these decisions on students and their families but emphasized the university’s commitment to maintaining affordability for in-state students at Commonwealth Campuses while implementing modest increases elsewhere.
Budget Balance and Strategic Adjustments
The proposed budget aims to address a significant operating deficit. Penn State has reduced its Education and General budget deficit from $44.5 million to approximately $7 million, with further improvements expected. The university faces challenges including inflation, rising salary costs, and increased employee benefits expenses. To achieve a balanced budget for 2025-26, Penn State plans to cut or reallocate $89 million in expenses, with reductions affecting academic colleges, administrative units, and Commonwealth Campuses.
Despite the budget cuts, Commonwealth Campuses will receive a combined total of $31 million in operating subsidies and up to $20 million from the president’s strategic fund to support their budgets. The voluntary buyout program in the spring has already resulted in $43 million in savings, though the final impact is pending.
The budget also includes permanent and one-time subsidies for specific colleges to address financial pressures. Bendapudi praised the efforts of the Penn State community in navigating these challenges and expressed confidence in the university’s ability to maintain its high-quality educational offerings while ensuring financial sustainability.
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